Consumer weakness looks to have extended through the first quarter, with retail spending in ÎÚÑ»´«Ã½ declining for a second consecutive month in February. Seasonally adjusted sales fell 0.1 per cent with real spending down 0.3 per cent. Five out of nine subsectors saw lower sales, with spending on discretionary items showing more signs of retrenchment in demand.
In contrast, ÎÚÑ»´«Ã½ spending outperformed with a 1.2-per-cent gain to fall just short of $9 billion in sales. In February, unadjusted retail sales—when compared to February 2023 unadjusted sales—were up by 5.7 per cent. Seven out of the nine subsectors saw higher year-over-year unadjusted February sales. That said, motor vehicle and parts dealers led the increase with a 14.3-per-cent gain, reflecting a surge in shipment supply. This is followed by general merchandise retailers, which saw a 12.8-per-cent increase, and then building material and garden equipment dealers, which reported sales figures that were up 19.8 per cent compared to the same month last year.
Balancing the increase in sales in these sectors were lower sales at gasoline station and fuel vendors, where sales were down 8.2 per cent. Sporting goods and hobby retailers reported a sales decline of five per cent. Year-to-date unadjusted retail sales were up 1.7 per cent totalling $15.5 billion.
In the Metro Vancouver area, seasonally adjusted retail sales were down 0.2 per cent for February compared to January 2024. Year over year, monthly unadjusted retail sales were up 7.5 per cent, while year-to-date sales were up by 3.4 per cent.
The number of non-resident travellers entering ÎÚÑ»´«Ã½ through British Columbia increased in February, marking the first increase in four months. On a seasonally adjusted basis, there were 10.8 per cent more visitors in February than there were in January, bringing non-resident visits up to nearly 684,000 people. This is the second-highest monthly number since the start of the pandemic. The number of same-day excursions increased 11.9 per cent and the number of overnight tourists increased by 10.2 per cent. These numbers are likely to rise if the Canadian dollar further weakens on the prospect that the Bank of ÎÚÑ»´«Ã½ will lower rates faster than the U.S. Federal Reserve.
The number of U.S. residents entering ÎÚÑ»´«Ã½ through ÎÚÑ»´«Ã½ increased 13 per cent in February to an approximate seasonally adjusted 531,000 people. The number of residents from countries other than the U.S. also rose—by 3.4 per cent. The increase in U.S. resident visits to ÎÚÑ»´«Ã½ through ÎÚÑ»´«Ã½ was seen across all modes of transportation. Air travel arrivals increased by 8.5 per cent, while automobile arrivals rose by 5.9 per cent. The number travellers arriving by other modes of transportation increased by 65.9 per cent. The number of non-residents from countries other than the U.S. arriving by land or water increased by 28.4 per cent, while those who came by air declined by 3.9 per cent.
Bryan Yu is chief economist at Central 1.
